In recent testimony to the Senate Finance Committee, Gary Cohen of the Centers for Medicare and Medicaid Services (CMS) gave an update of progress on Health Insurance Exchanges (HIX) implementation, now called Health Insurance Marketplaces. There is plenty to do, as shown in the timeline CMS presented that day, below.
Progress on Health Insurance Marketplace Implementation:
Consumers and small businesses begin to enroll Oct. 1, 2013, for coverage that starts Jan. 1, 2014. Before then, CMS must review exchange blueprints from states that decided to run exchanges on their own or in partnership with CMS. Then, health insurers applying to be Qualified Health Plans (QHP) on the exchanges must submit their rate and benefit designs for review, a process to be completed by July. In the meantime, all technical and IT aspects of the exchange enrollment procedures must be made ready.
“The progress already made and the foundations we have developed give us confidence that the Marketplace will be ready for consumers on October 1,” said Cohen, Deputy Administrator and Director of the CMS Center for Consumer Information and Insurance Oversight (CCIIO)
The end result will be a marketplace that makes health insurance choices simpler for consumers. Consumers will enter basic personal information, the exchange will verify income and eligibility for Medicaid, or premium and cost-sharing subsidies for QHPs. There will be one application – available in a user-friendly format on the web and in more traditional media – no matter which program the consumer is eligible for.
Establishing State and Partnership Exchanges:
The CCIIO so far has conditionally approved 18 state-run exchanges, or marketplaces, and seven partnership marketplaces. The Affordable Care Act (ACA) health reform law and subsequent CMS regulations set baseline qualifications for health plans, many of which apply regardless of whether the plans are offered in the exchanges or not. In short, starting in 2014, QHPs must:
- Offer the Essential Health Benefits (EHB) package, slightly different for each state. This will be a major change for most commercial insurers – only about 2 percent of them now cover all federally mandated health benefits. Full maternity and pediatric vision and dental benefits are often not covered in private health plans but must be starting in January 2014.
- Adhere to actuarial value requirements by offering at least one silver-level plan (covering 70 percent of expenses), one gold-level plan (covering 80 percent of expenses), and a child-only plan.
- Meet network adequacy and service area requirements.
- Have state licensure and be in good financial standing.
- Set premiums based on adjusted community rating.
- Submit to rate reviews.
- Be accredited through either URAC or the National Committee for Quality Assurance (NCQA)
States can choose whether to allow all plans meeting those requirements to compete for customers in the Health Insurance Marketplaces, or whether to choose QHPs through a procurement process. States may also impose requirements for QHP certification in addition to the federal standards. In partnership exchanges and federally facilitated exchanges, CMS has the final say on certification.
For a breakdown of issues health plans must consider before deciding whether to apply for QHP status, see my earlier post: 10 Considerations for Health Insurers Deciding on Health Insurance Exchange Participation.
Some states are further in the process than others. Some have not yet fully described how they intend to run the exchanges. The timeline CMS presented to the Senate Finance Committee says the U.S. Secretary for Health and Human Services, Kathleen Sebelius, will make final decisions for the marketplaces in March 2013.